Healthcare, e-commerce and edtech are booming
dubai — Grocery delivery, healthcare, e-commerce and edtech are booming and will surely see surge in funding as investors seek to park funds in these startups.
The outbreak of coronavirus paved way for ‘social distancing’ and hence remote working, distance learning became a new norm. The latest quarterly report from Magnitt released on Monday morning indicates a surge in investment by two per cent year on year basis and states that “investor appetite in startups that have seen increased activity in the current time, with grocery delivery, healthcare, e-commerce, and edtech seeing an increase in both customers and investments”.
The Middle Eastern and North African (Mena) startups investment report highlights that startups raised $277 million in the first three months of 2020. However, this was largely attributed to a strong start to 2020, with several startups raising large funding rounds in January and February, including Kitopi ($60 million), Vezeeta ($40 million), and SellAnyCar ($35 million).
The number of investment deals, on the other hand, paints a different story. In Q1 2020, deals were down 22 per cent compared to Q1 2019, with March 2020 alone seeing a drop of 67 per cent compared to the same month last year. “Historical data highlights that investment rounds across Mena tend to take, on average, 6 months to come to fruition,”said Philip Bahoshy, Magnitt’s founder and chief executive officer.
“We will most likely not see the full impact of Covid-19 on the venture funding space yet for a few months. However, early indications have already shown a slowdown in funding announcements, as startups and investors re-evaluate their positions in this new environment.”
Mena investors and accelerators were still actively investing (as of March 2020) despite the current crisis.